P&G teams with e-commerce platform Loop as part of big sustainability test

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UPDATE: News reports out of Davos, including one from our sister publication Waste Dive, indicate Loop's launch involves a number of large consumer goods brands in addition to P&G who are also redesigning their packaging to be reusable. The involvement of Nestlé, PepsiCo, Unilever, Mars Petcare, The Clorox Company, The Body Shop, Coca-Cola European Partners, Mondelez International and Danone means consumers will be able to order a number of widely used products online from Loop when the test launches.

Dive Brief:

Procter & Gamble (P&G) announced at the World Economic Forum Annual Meeting in Davos today (Jan. 24) that it is the first consumer goods company to partner with Loop, an e-commerce platform created by the private recycling firm TerraCycle. P&G plans to bring 11 brands, including Tide, Oral-B and Gillette, to Loop later this year, and will test the service's delivery system in-market in New York and Paris in mid-2019.

As part of the initiative, P&G is introducing more reusable, refillable and durable packaging options to the 11 brands coming to Loop. Pantene is debuting a lightweight aluminum bottle for shampoo that can be refilled, and similar containers are arriving for lines like Tide and Crest. More disposable items, such as toothbrush heads, razors and diapers, will be recycled by Loop.

Loop looks to build out an environmentally-friendly business model for online shopping, selling products through its own website or partner websites that are designed to reduce packaging waste and improve convenience. The platform delivers its orders in a shipping tote in place of common single-use materials like cardboard boxes. Users can put their empty containers in the tote, and Loop will pick them up from the home to be cleaned and refilled and will recycle any excess packaging and materials that it can.

Dive Insight:

P&G's tie-up with Loop shows how sustainability is becoming a bigger item on the agenda for the marketer as consumers grow more concerned about businesses' impact on the environment. The Cincinnati-based company is also potentially taking a page from chief competitor Unilever, which has seen success in centering much of its brand purpose over the last several years around promoting sustainable living. P&G last April announced an Ambition 2030 platform to create a more positive environmental impact and inspire consumers to do the same, and the company is positioning the Loop deal as a means of furthering that goal.

But beyond the eco-friendly angle, the partnership helps to highlight P&G's growing focus on developing a richer, more diverse e-commerce playbook. Some of that mission has involved taking a page from direct brand competitors, such as through Gillette Direct, which mirrors the online subscription model popularized by disruptors like Dollar Shave Club. But increasingly P&G is experimenting with products specifically designed around online shopping, including through a slew of new offerings the marketer showcased at CES earlier this month or a Tide Eco-Box it rolled out last year.

Redesigning the packaging for 11 core brands, even as a test in limited markets, for the Loop partnership marks a considerable ramp up in P&G's approach to both sustainability and e-commerce innovation. At CES, executives pinpointed a number of factors driving what they called "mass disruption," including the environmental issues and growing resource scarcity that increasingly affects their business strategy.

"The water crisis and other environmental challenges will change the way people live and consume, which brings massive opportunities for innovation," Kathy Fish, P&G's chief research development and innovation officer, said at the Las Vegas show.

The in-market Loop tests planned line up timing-wise around when P&G will be initiating some significant internal restructuring as well. Starting in July, the company aims to reorganize around six category-based business units, each led by its own CEO who will lead major decision-making, including around product and packaging innovation.